Three Key Reasons Why Investing in Multifamily Is Better
There are many reasons to invest in multifamily real estate as opposed to single family; primarily the fact that you can save yourself a lot of headaches. It’s scalable, it has efficiencies that single family investing lacks, and you can achieve your goals with less deals and less work. I am not against investing in single family homes – that’s how I got my start – but I have come to realize over the course of my journey that I can make a much bigger financial impact in a shorter amount of time by investing in multifamily.
- - Multifamily is more scalable.
With one large commercial multifamily deal you can build in the systems to run your portfolio from the start. You can have onsite property managers and full-time maintenance staff from day one.
- - Multifamily is more efficient.
Imagine a 100-unit apartment complex. This apartment building (ideally) has the same HVAC units and the same hot water heaters for each unit, as well as one roof covering all of those units. The full-time maintenance staff knows how to fix each item because they are all the same and each repair is done onsite with no travel time. On top of that, they can store extra parts and equipment on-site. This is economies of scale at place – the more units, the less cost per unit to maintain.
- - It takes less time and effort to build up your portfolio.
By applying the same time and effort that you would to close a SFR, you could close a multifamily property. The vast difference is going to be the impact of the purchase. You are going to get much more by closing the multifamily property. You can reach you passive income goals, number of units goal, or network goal by acting in multifamily closing less deals but bigger deals.
Investing in multifamily properties can set you on your way to financial freedom because its scalable, efficient, and you can achieve bigger results faster. Now is the time to get started because interest rates are so low, private equity is abundant, and there is increased opportunity with less competition from big time buyers. This is the asset class you want to be in for true passivity, and there is no better time than now. Don’t hesitate, be brave, and surround yourself with the right people to make it happen because when you look back in 20 years you will be glad you did.